Receiving benefits as a retiree is not always as simple as it appears. There are several elements that influence whether or not a person is eligible for Social Security payments, one of which is a person’s work history. In a historic decision on Tuesday, 327 MPs restored certain retirees’ right to claim pensions.
The House of Representatives passed the Social Security Fairness Act, which repeals two restrictions that cut Social Security benefits for people who receive pensions from state or local governments.
The rules are as follows: the windfall elimination provision, or WEP, which reduces Social Security benefits for individuals who worked in jobs where they did not pay Social Security payroll taxes and now receive pension or disability benefits from those employers; and the government pension offset, or GPO, which reduces Social Security benefits for spouses, widows, and widowers who also receive pension checks.
The bill’s original sponsors, Reps. Abigail Spanberger, D-Va., and Garret Graves, R-La., said in a joint statement, “This has been 40 years of treating individuals differently, discriminating against a specific set of workers. They are not overpaid, nor are they underworked.”
According to the Congressional Research Service, the WEP affected around 3% of all Social Security claimants (2.1 million persons) in 2023, while the GPO affected approximately 1% of all Social Security beneficiaries (745,679 individuals).
The National Committee to Preserve Social Security and Medicare described the proposal as a “step in the right direction” and a “bipartisan victory for public sector employees and their families.”
Max Richtman, the president and CEO, expressed his moderate satisfaction with the efforts. “We have long advocated for the repeal of the WEP and GPO provisions, though we would have preferred that Congress take up the more comprehensive improvements in Rep. John Larson’s Social Security 2100 Act.”
Larson’s proposal would remove the WEP and GPO, as well as introduce additional temporary benefit increases, but unlike this bill, it includes a strategy for funding, requiring persons with more than $400,000 in income to pay extra Social Security payroll taxes.
As he noted, “I could not vote for the bills on the floor tonight because they are unpaid for, putting Americans’ hard-earned benefits at risk.” It would disproportionately affect the five million Americans who receive below-poverty checks, as well as nearly half of all Social Security recipients who rely on their earned benefits for the majority of their income.
Larson also voted against the Equal Treatment of Public Servants Act, which would have retained the WEP but used a new formula for Social Security retirement and disability benefits for pensioners.
Critics say the bill will weaken Social Security
Larson is not the only one who opposes the bill; the Congressional Budget Office estimates that it will increase Social Security deficits by $196 billion over the next decade, something the Committee for a Responsible Federal Budget cannot support.
Spanberger did not allow this issue to block the advancement of the measure, as the calculated six months that the program would lose due to the implementation is not enough to warrant leaving Americans without benefits.
“The long-term solvency of Social Security is something that Congress must address. But that is a separate problem from letting Americans who worked hard and contributed to society to retire with dignity.”
Romina Boccia, director of budget and entitlement policy at the Cato Institute, strongly disagrees, stating, “This is not the correct strategy. Special interests pushed for it, and politicians listened. We should modify Social Security such that it offers basic income security to the most vulnerable Americans in old life without increasing the debt or tax burden on younger workers.”
The measure must still pass the Senate before it can be signed into law, but there is no reason to believe it would not.
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